Net income in the period ended Nov. 2 rose 22 percent to
$177 million, or 47 cents a share, from $145 million, or 36
cents a year earlier, Cincinnati-based Macy’s said today in a
statement. The average of 19 analysts’ estimates compiled by
Bloomberg was 39 cents. Revenue gained 3.3 percent to $6.28
billion, topping the $6.19 billion average projection.

Chief Executive Officer Terry Lundgren drove sales by
better matching goods to local demand and intensifying marketing
efforts. Revenue was particularly strong in October, and the
company is “entering the fourth quarter with confidence,”
Lundgren said in the statement. That marks a rebound from the
second quarter, when sales unexpectedly fell.

“This was a big turnaround,” Brian Yarbrough, an analyst
with Edward Jones & Co. in St. Louis, said in a phone interview
today. “Macy’s is the first of many retailers to report, but it
does sound like there is some hope there for the holiday
season.”

Yarbrough rates the shares hold.

Macy’s advanced 9.4 percent to $50.68 at the close in New
York for the biggest gain since June 2009. The shares have
climbed 30 percent this year, compared with a 25 percent gain in
the Standard & Poor’s 500 Index.

Holiday Season

Sales in November and December account for 20 percent to 40
percent of U.S. retailers’ annual revenue and 20 percent of
their profit, according to the National Retail Federation, a
Washington-based trade group. Last year’s fourth quarter
accounted for 34 percent of Macy’s sales and 55 percent of its
profit.

Macy’s third-quarter sales at stores open at least a year
advanced 3.5 percent, topping analysts’ average estimate of a
1.9 percent gain.

Sales trends improved in every region from the spring
season, and both the Macy’s and Bloomingdale’s chains performed
well, the retailer said.

The company repeated its forecast that profit in the year
through January will be as much as $3.90 a share. Analysts
estimate $3.78.